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TMI Blog2018 (6) TMI 1390X X X X Extracts X X X X X X X X Extracts X X X X ..... ases relied upon by the assessee as well as other cases/comparable cases, which are relevant for adjudication for the issues in hand. The assessee is also at liberty to furnish necessary evidences, if any, in support of its claim. Thus, the appeal of the assessee on the issues in hand is remanded back to the file of the ld. DRP for fresh adjudication - ITA No.2702/Del/2014 - - - Dated:- 26-6-2018 - SHRI JOGINDER SINGH, JUDICIAL MEMBER AND SHRI R. K. PANDA, ACCOUNTANT MEMBER For The Assessee : Shri Vishal Kalra And Ms. Reema Malik For The Department : Shri H. K. Choudhary, CIT-DR ORDER PER JOGINDER SINGH, JM : This assessee is aggrieved by the impugned order dated 23/12/2013 passed u/s 144C(5) of the Inco ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... onducting market surveys, coordination activities, liaising activities and similar services. The assessee declared total income of ₹ 70,24,580/- in its return filed on 24/02/2010, which was further revised to ₹ 1,10,.62,980/- on 29/09/2010. The case of the assessee was selected for scrutiny, therefore, the Ld. TPO examined the arm s length Price (ALP) of the international transactions entered into by the assessee. The Ld. TPO made an adjustment of ₹ 2,55,34,575/- to the ALP of the international transaction relating to provision of services. The assessee objected to the adjustment made by the Ld. TPO before the Ld. DRP. The Ld. DRP while dealing with the objections of the assessee adjudicated upon few comparable companies s ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... g. Overseeing inspection and weighing of goods shipped from overseas for delivery to Indian customers. 2.3. We find that the assessee adopted transactional net margin method (TNMM) with profit level indicator of operating cost to total cost (OP/TC). The assessee selected broadly about 22 comparable companies for bench marking the international transactions pertaining to business support services to AEs. In its search, the assessee selected market research companies engaged in the business of arranging tours and travels, facilities management and event management etc. As per the TP study, the margin of the assessee was 12.26% (page 415 of the paper book), resultantly, the international transaction pertaining to provision of services by th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Mean margin 20.30 2.5. The grievance of the assessee, before this Tribunal is that the Ld. DRP did not appreciate the functions, assets and risk profile of the assessee and thus erred in comparing the present assessee with the companies which are functionally different. Our attention was invited to pages 285-287 of the paper book. 3. So far as, ground no. 7, raised by the assessee, is with respect to alleged erroneous exclusion of comparable company Trade wings Ltd. by the Ld. DRP/TPO. It was explained that the comparable company i.e. Trade Wings Ltd. was rejected by Ld. TPO, holding that it does not pass the service income filter of 75% (page 17 of the TP order). However, the Ld. DRP vide its ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... to its AEs for which the assessee charges a markup of 10% on costs for such services for which no service delivery risk or credit risk is borne by the assessee. It was explained that the assessee is reimbursed for all costs incurred by it in relation to providing business support services and also on a markup basis. The Ld. CIT-DR defended the addition. In reply, the ld. Counsel for the assessee, placed reliance upon the decisions in the case of Sony India Pvt. Ltd. vs DCIT (2008) 114 ITD 448 (Del.), Philips Software Centre Pvt. Ltd. vs ACIT (2008) 119 TTJ 721 (Bangalore), Mentorgraphics (Noida)(P.) Ltd. vs CIT (2007) 109 ITD 101(Del.), Kodiak Networks India Pvt. Ltd. vs ACIT (2012) 52 SOT 189 (Bangalore) and E-Gain Communications Pvt. Ltd. ..... X X X X Extracts X X X X X X X X Extracts X X X X
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